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Applebee sold an issue of 30-year, $1,000 par value bonds to the public. The coupon...

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Finance

Applebee sold an issue of 30-year, $1,000 par value bonds to the public. The coupon rate of 8.75% is payable annually. It is now five years later, and the current market rate of interest is 7.25%. What is the current market price (intrinsic value) of the bonds? Round off to the nearest $1. a. $715 b. $1,171 c. $1,225 d. $697

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